Real Return Calculator
A 7% return isn’t 7% of buying power. Convert a nominal return into a real, inflation-adjusted one and see what your money is truly worth later.
Inflation-protected investing options
Learn moreReturns in today’s dollars
Inflation erodes the value of every future dollar, so the only return that matters for your standard of living is the real return — what’s left after inflation. Over decades the gap between nominal and real growth is enormous, which is why planning in today’s dollars is more honest.
How it’s calculated & sources
Real return = (1 + nominal) ÷ (1 + inflation) − 1 (the Fisher equation). We project the investment at both the nominal and real rates to show the difference in today’s dollars.
Benchmark: the Fisher equation. Long-run U.S. stock real returns have averaged ~6–7%; bonds far less.
Results update as you type and are general estimates, not personalized financial, tax, medical or legal advice. Verify with a professional.
Worked example
A 7% nominal return with 3% inflation is about a 3.88% real return. $10,000 grows to ~$38,700 nominal over 20 years, but only ~$21,500 in today’s buying power.
Frequently asked questions
Is subtracting inflation close enough?
For rough work, yes (7% − 3% ≈ 4%). The exact Fisher formula is slightly lower and matters more at higher rates.
Should I plan in real or nominal terms?
Real — it keeps goals in today’s purchasing power, so a $1M target actually means $1M of spending power, not a shrunken future dollar.